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Singapore shares close higher as blue chips enjoy large window-dressing push

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ON May 31, volume done in the local market surged to S$1.97 billion, more than triple the S$600 million done one day earlier, more than double the average for the week before and easily the best one-day total in 2016. That day the Straits Times Index (STI) jumped 38 points to an intraday high of 2,834, but the momentum that was widely attributed to month-ending window-dressing failed to hold and it closed with a net loss of 5.69 at 2,791.06. The next day, June 1, turnover plunged to S$1 billion followed by S$731 million on June 2.

Fast forward a month and history repeated itself on Thursday June 30, when the STI jumped to 88 points to open at 2,880 but again the momentum failed to hold, the index eventually closing at 2,840.93 with 1.5 billion units worth S$1.8 billion traded - almost twice the turnover of the day before.

Once again it was highly probable that window-dressing played a significant part, particularly as June 30 marks the end of the first half/second quarter, unlike May 31 which simply marks the end of a month. For the first half, the index is down 1.5 per cent; for the second quarter there is no gain or loss as the STI closed at exactly the same level as it did on March 31.

Almost forgotten was "Brexit", Britain's citizens voting to exit the European Union, an event which had been touted as spelling possible financial armageddon by specialists, but whose negative influence on stocks lasted all of two days. In the three trading days after the vote, the index has bounced 111 points or 4 per cent.

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